The Silverside Company is considering investing in two alternative projects: Project 1 Project 2 Investment $500,000 $210,000 Useful life (years) Estimated annual net cash inflows for useful life $130,000 $65,000 Residual value $32,000 $18,000 Depreciation method Straight-line Straight-line Required rate of return 14% 8% What is the payback period for Project 1? O A. 15.63 years OB. 3.23 years O C. 8.55 years OD. 3.85 years The Porch Cushion Company manufactures foam cushions. The number of cushions to be produced in the upcoming three months follows: Number of foam cushions to be produced in July Number of foam cushions to be produced in August Number of foam cushions to be produced in September 14,000 10,000 14,000 Each cushion requires 3 pounds of the foam used as stuffing. The company has a policy that the ending inventory of foam each month must be equal to 30% of the following month's expected production needs. How many pounds of foam does The Porch Cushion Company need to purchase in August? O A. 21,000 O B. 39,000 OC. 33,600 OD. 42,600 The Rainy Division of Seattle Corporation reported the following results from the past year. Shareholders require a return of 13%. Management calculated a weighted average cost of capital (WACC) of 8%. Rainy's corporate tax rate is 25%. Sales $600,000 Operating income 240,000 Total assets 1,700,000 Current liabilities 300,000 What is the division's Residual Income (RI)? O A. $240,000 O B. $78,000 O c. $162,000 OD. $19,000